By John Young
Updated July 12, 2011 at 12:00 PM EDT

Netflix members will soon find themselves faced with a tricky dilemma: to stream or not to stream? The video-streaming and DVD-by-mail company announced Tuesday that it’ll be splitting its streaming and DVD services into two separate plans. One plan, an unlimited streaming-only option, will cost $7.99 per month. The other plan, an unlimited DVD-only option, will also cost $7.99 (for one DVD out at a time). Members can enroll in both services for a combined rate of $15.98 per month.

For Netflix users who currently stream movies and receive DVDs by mail, this new pricing scheme represents a steep 60-percent increase in monthly costs. Previously, Netflix offered a $9.99 plan that provided both unlimited streaming and unlimited DVDs (with one disc out at a time). Now these members will have to choose between keeping both streaming and DVDs for an increased $15.98 per month, or cutting one of the services to bring their monthly dues down to $7.99. The revamped pricing plans are effective immediately for new subscribers, and on or after Sept. 1 for current members. Blu-ray discs still carry a surcharge — for the one-DVD-at-a-time plan, it’s an extra $2 per month.

In a corporate blog post, Netflix claimed that the creation of a separate DVD-only plan was a way to reassert its commitment to DVDs. “Last November when we launched our $7.99 unlimited streaming plan, DVDs by mail was treated as a $2 add on to our unlimited streaming plan,” wrote Jessie Becker, Netflix’s marketing vice president. “Since then we have realized that there is still a very large continuing demand for DVDs. Given the long life we think DVDs by mail will have, treating DVDs as a $2 add on to our unlimited streaming plan neither makes great financial sense nor satisfies people who just want DVDs. Creating an unlimited DVDs by mail plan (no streaming) at our lowest price ever, $7.99, does make sense and will ensure a long life for our DVDs by mail offering.”

How current members respond to the new plans will depend on whether they considered Netflix primarily a DVD service with the added benefit of streaming, or primarily a streaming service with the perk of receiving DVDs. A visit to Netflix’s home page quickly reveals where the company is placing its chips. The site extols the wonders of instant streaming; only in the “Frequently Asked Questions” section does Netflix mention that, oh yeah, we also ship DVDs. A separate site,, exists for those interested in the DVD-only plans.

Netflix users will also have to decide between the larger library of DVD titles and the instant gratification of streaming. My queue, for instance, contains a total of 61 movies. Of those, 57 are available on DVD, but only 22 are offered via streaming. As someone who prefers the guaranteed high-def crispness of Blu-ray discs — to my eyes, HD streaming usually appears a notch inferior — I’m anticipating that I’ll opt out of the streaming plan. But I will definitely miss the ability to browse Netflix’s ever-growing streaming library and instantly start watching some acclaimed drama from Kazakhstan. Or maybe I’ll cave in and pony up the $17.98 a month (including $2 for Blu-ray) for both streaming and discs. After all, $17.98 is still less than what I shelled out to watch Transformers: Dark of the Moon in IMAX 3D.